Chaucer ramps up ESG strategy to be at forefront of change

Insurance group Chaucer has said it has set a target to be carbon neutral across its operations by 2030 or sooner with changes to both its investment and underwriting strategies.

It unveiled an update to its ESG sustainability strategy, which outlines how Chaucer will “decarbonise its business and embed ESG into the underwriting decision making process”.

John Fowle, (pic) Chaucer’s CEO said the move recognises the need for (re)insurers to be at the heart of the drive to net zero.

“At Chaucer, we believe ESG should underpin everything we do to meet the increasing need for global sustainability progress.”

“The (re)insurance industry has an important role to play to encourage its business partners to improve on Environmental, Social and Governance matters and Chaucer is determined to be at the forefront of this movement.”

“Our ESG data-driven strategy has been designed to produce measurable results to hold ourselves and our counterparties to account on crucial ESG factors. Our ESG vision should produce real change and have a visible impact on the way we do business across all of our core functions.”

In 2022, Chaucer announced that it intended to achieve Net Zero greenhouse gas emissions by 2050 or sooner and aims to be carbon neutral across its operations by 2030 or sooner.

Chaucer’s said its revised ESG strategy will be applied across all six of its defined core functions – investments, marketing, underwriting, operations, risk, and governance. Each core function has its own unique sustainability purpose, focus and objectives for 2023.

As part of its strategy, outlined in the firm’s Sustainability Report, Chaucer is already taking action to:

  • Continue and grow existing investment methods and metrics to its ESG approach
  • Embed ESG into its underwriting operating model.
  • Build on its ESG approach in its operating model and supplier due diligence process.
  • Obtain ESG scores for its entire portfolio, set out targets for improvement
  • Develop governance of ESG processes

“The update of its ESG strategy is the latest in a series of initiatives taken by Chaucer to become more sustainable as a business,” the company said in a statement. “Chaucer has already implemented changes to help its operations become as environmentally friendly as possible. These include using 100% renewable energy in its London headquarters, reducing in-office monitors from 920 to 330 and using rechargeable batteries for all IT equipment.”

Chaucer added its commitment to ESG principles was “further reflected” in its lead support of Yokahu, a parametric microinsurance coverholder with whom Chaucer has co-created a microinsurance solutions for underserved communities in the Caribbean.

“In Q3 2022 Chaucer rolled out its ESG Balanced Scorecard, which it created alongside Moody’s,” it added. “The scorecard measures the performance of clients and business partners, using up to 158 unique data points to assign scores across various ESG factors.

“Chaucer is working to enhance data quality and embed a pre-bind tool to determine the ESG score of prospective clients, so that ESG performance is considered during the underwriting decision-making process.”